MEMO: Energy Savings Performance Contract

April 6, 2020

Dear MSAD #1 Community, 

I am writing to provide some details and clarification on a proposed energy savings performance contract at Presque Isle High School.  We have received some questions over the past week related to this project and I would like to take an opportunity to address them.  

What is an energy savings performance contract?

An energy savings performance contract allows school districts to make energy efficiency and air quality improvements to schools.  A district selects an energy service company to perform an audit on the mechanical systems, electrical system, air exchange system, lighting, and water consumption in each building. 

After the audit is complete, which normally takes 60-90 days, the energy service company presents a list of possible projects that could be done to improve energy efficiency and air quality.  The energy service company guarantees savings up to a certain dollar amount should the recommended improvements be approved and implemented. If the savings are not reached by the district, the energy service company pays the school district for the unmet savings. 

Why are we focusing on energy efficiencies and air quality at Presque Isle High School?

Presque Isle High School, while well-maintained over the years, is an old, large building.  The windows on the first and second floor of the high school were last replaced approximately 35 years ago. Other portions of the building have windows that originally were installed in the late 1950’s and 1960’s. Ice builds up on some of the windows in the winter, many of the handles that are used to open the windows are broken and are irreplaceable due to the age of the windows, and many have condensation and caulking stains.  Some windows have plexiglass installed on the frames to prevent draft. Classrooms, especially those on the second floor, are uncomfortably hot in warm weather, and those same classrooms are cold in the winter due to the inefficient windows and old heating system. It is not uncommon for students and staff to wear their coats and mittens in classrooms during the winter.  

We are unable to replace the windows at the high school without also needing to make upgrades to our air exchange unit ventilators and heating system. This will allow for our classrooms to effectively circulate heat and air in order to provide a safe and comfortable environment for students and staff that is conducive to teaching and learning.  

What projects are proposed for Presque Isle High School?

  • New windows and siding on the Griffin St. facing part of the building.
  • LED lighting upgrades in multiple MSAD #1 schools.
  • Steam to hot water heating conversion and new heating units in classrooms in the original wing (1948) of PIHS. 
  • Air exchange unit ventilators in the classrooms in the original wing (1948) of PIHS. 
  • Electrical system upgrades.
  • Water conservation measures including replacement of water-saving faucets and toilets. 

How much will it cost?

The total cost of the project is not to exceed $4,050,000.  The cost will likely be less once we confirm our interest rate and bids on our projects.  We will have an annual payment of $300,000 for 17 years to pay for the project. Siemens, our selected energy service company, has guaranteed us savings on $150,000 due to the energy efficiency and air quality upgrades.  Therefore, the district will need to fund $150,000 out of our operating budget for the next 17 years.  

This project would not be enough to upgrade our entire 200,000 square foot building.  We would be looking at a second phase, at a comparable cost, to complete the energy updates to the rest of the building in future years as operating budgets allow. 

How will we pay for this project?  Will my taxes go up?

Our first payment is due July of 2021.  We are eligible for a grant from Efficiency Maine of approximately $140,000 for lighting upgrades that we would be able to apply to the loan.  We believe we can make the $150,000 annual payment out of our maintenance budget without an increase to local taxes. We also will be retiring $233,000 of debt in 2024 and an additional $219,000 in 2025 from the Presque Isle Middle School building project and the PIHS oil to propane conversion project for a total of $450,000 that we can use to allocate toward future payments.

When will the MSAD #1 School Board vote on this project?

The MSAD #1 Board of Directors will be reviewing this project at our Wednesday, April 15 meeting.  If final pricing and financing come in as projected, the project is scheduled to go to vote by the school board on Wednesday, May 13.

Thank you for your interest in learning more about this project.  MSAD #1 has a long history of investing in, maintaining, and caring for our facilities.  We hope that by investing in the operating systems of Presque Isle High School, we are making the high school a sustainable place to educate our students for years to come.


Ben Greenlaw